Ownership of Property Depends on Intention

October 3, 2012

Ownership of Property Depends on Intention

Property can be owned in joint names as joint tenants, which means that each co-owner owns an undivided share in the whole property (and would therefore be the sole owner on the death of any co-owners), or as tenants in common, where each co-owner has a specified share in the property that is not necessarily equal. It is also possible for the deeds to a property to be in the name of one person but for another person to acquire an interest in it.

The relevant law in this area was set out clearly in a recent High Court case, which involved a dispute over the exact ownership of a converted barn in North Yorkshire. Arthur Aspden met Joy Elvy in 1985. In 1986, following Mr Aspden’s purchase of Outlaithe Farm, the couple began living together and went on to have two children.

The couple split up in 1995/1996. Ms Elvy left the farm with the children, but continued to be in daily contact. In 2006, Mr Aspden transferred a barn at the farm into Ms Elvy’s name and this was subsequently converted into a dwelling house at a cost of about £90,000. Mr Aspden alleged that he had provided the majority of the cash funds and carried out labouring work for the conversion, which he said he had done because the couple intended to marry and live in the barn. Ms Elvy denied this. She argued that it was ‘in recognition of her contributions to the family’ and that Mr Aspden consequently had no beneficial interest in the barn, which by this time was worth £400,000.

Judge Behrens pointed out that if a property is in joint names, the presumption will be that the co-owners intended to own it as joint tenants. This presumption can be overturned, but it is difficult to achieve this unless there is evidence that the co-owners actually intended to own the property in agreed proportions. By comparison, where a property is in a sole name, the person alleging a beneficial interest, whose name is not on the deeds, has to establish the existence of some sort of trust. There is no presumption of joint ownership. However, such a trust could arise some years after a property was initially acquired in one name.

In this particular case, the judge held that there was ‘a common intention that Mr Aspden should have some interest in the barn as a result of his substantial contribution in money and labour’. He found that Mr Aspden had a beneficial interest in the property which the judge assessed at 25 per cent.